-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, sLuMrCgDtMHqqYDsyh6UnK8hlJuwoVh+paIUdJFJP60+DvNLnxQ655qHPXOq/XHK 6tSwaQ05KhUFLaHTF62m0A== 0000740670-94-000007.txt : 19940802 0000740670-94-000007.hdr.sgml : 19940802 ACCESSION NUMBER: 0000740670-94-000007 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940131 FILED AS OF DATE: 19940729 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MICHAELS STORES INC CENTRAL INDEX KEY: 0000740670 STANDARD INDUSTRIAL CLASSIFICATION: 5945 IRS NUMBER: 751943604 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-11822 FILM NUMBER: 94540654 BUSINESS ADDRESS: STREET 1: 5931 CAMPUS CIRCLE DR CITY: IRVING STATE: TX ZIP: 75063 BUSINESS PHONE: 2147147000 MAIL ADDRESS: STREET 1: PO BOX 619566 CITY: DFW STATE: TX ZIP: 75261 11-K 1 FORM 11K FOR THE YEAR ENDED JANUARY 31, 1994 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] For the fiscal year ended January 31, 1994 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from ------------ to ------------ Commission file number 0-11822 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: MICHAELS STORES, INC. EMPLOYEES 401(K) PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: MICHAELS STORES, INC. 5931 Campus Circle Drive, Irving, Texas 75063 P.O. Box 619566, DFW, Texas 75261-9566 Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees have duly caused this annual report to be signed on its behalf by the undersigned thereunto duly authorized. MICHAELS STORES, INC. EMPLOYEES 401(K) PLAN Date: July 29, 1994 By: ------------------- Donald C. Toby Trustee MICHAELS STORES, INC. EMPLOYEES 401(K) PLAN In February 1987, Michaels Stores, Inc. (the "Company") established the Michaels Stores, Inc. Employees 401(k) Plan (the "401(k) Plan"). The fiscal year of the 401(k) Plan is February 1 to the following January 31. The name of the issuer of the securities held pursuant to the 401(k) Plan and the address of its principal executive office is Michaels Stores, Inc., 5931 Campus Circle Drive, Irving, Texas 75063, P.O. Box 619566, DFW, Texas 75261- 9566. Changes in the 401(k) Plan. There were no material changes in the provisions of the 401(k) Plan during the fiscal year ending January 31, 1994 ("Fiscal 1993"). Changes in Investment Policy. There were no changes in the investment policy of the 401(k) Plan during Fiscal 1993. Contributions Under the 401(k) Plan. The Company makes annual employer matching contributions to the 401(k) Plan for the account of each participating employee in an amount equal to $.50 for each $1.00 of salary reduction contributed by such employee, up to a maximum Company contribution equal to 3% of the employee's compensation; provided that the aggregate amount required to be contributed by the Company during any fiscal year to all plans sponsored by the Company that are qualified within the meaning of Sections 401(a) and 401(k) of the Internal Revenue Code of 1986 (the "Code") is limited to 20% of the Company's net profit for such fiscal year. Participating Employees. As of January 31, 1994, there were 1,969 employees participating in the 401(k) Plan. Administration of the Plan. The 401(k) Plan is administered by an Administration Committee consisting of three persons, all employees of the Employer, appointed by the Employer's Board of Directors. The members of the Administration Committee serve at the discretion of the Board of Directors without compensation for their services. The members of the Administration Committee are: Sam Wyly Chairman of the Board of Directors and Chief Executive Officer, Michaels Stores, Inc. Jack E. Bush President, Chief Operating Officer and Director, Michaels Stores, Inc. Donald C. Toby Vice President-Personnel, Michaels Stores, Inc. -1- The address of each of the members of the Administration Committee listed above is Michaels Stores, Inc., 5931 Campus Circle Drive, Irving, Texas 75063, P.O. Box 619566, DFW, Texas 75261-9566. The Administration Committee directs the operation of the 401(k) Plan and may make administrative and procedural regulations. Certain administrative functions may be delegated to officers or employees of the Company. Administration Committee members, officers and employees do not receive compensation from the 401(k) Plan. Custodian of Investments. The assets of the 401(k) Plan are held by a trust and managed by trustees ("Trustees"), who may be employees of the Company. At present, the members of the Administration Committee also serve as the Trustees. The Company furnishes the 401(k) Plan with a fidelity bond in the amount of $1,000,000 covering the Trustees. The Trustees receive no compensation from the 401(k) Plan. Reports to Participating Employees. Each participant and retired participant having an interest in the 401(k) Plan receives quarterly statements of his or her accounts each plan year. -2- INDEX TO FINANCIAL STATEMENTS PAGE Report of Independent Auditors F-1 - - ------------------------------ Financial Statements: - - -------------------- Statements of Net Assets Available for Plan Benefits F-2 to F-3 Statements of Changes in Net Assets Available for Plan Benefits F-4 to F-5 Notes to Financial Statements F-6 to F-11 Supplemental Schedule: Schedule - - --------------------- Assets Held for Investment Purposes 1 F-12 Consent of Independent Auditors F-13 - - ------------------------------- A schedule of party-in-interest transactions has not been presented because there were no party-in-interest transactions which are prohibited by ERISA Section 406 and for which there is no statutory or administrative exemption. -3- REPORT OF INDEPENDENT AUDITORS Board of Directors Michaels Stores, Inc. We have audited the accompanying statements of net assets available for plan benefits of Michaels Stores, Inc. Employees 401(k) Plan as of January 31, 1994 and 1993, and the related statements of changes in net assets available for plan benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Plan at January 31, 1994 and 1993, and the changes in its net assets available for plan benefits for the years then ended, in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental schedule of Assets Held for Investment Purposes (Schedule 1) is presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974, and is not a required part of the basic financial statements. The supplemental schedule has been subjected to the auditing procedures applied in our audit of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. ERNST & YOUNG Dallas, Texas July 22, 1994 F-1 MICHAELS STORES, INC. EMPLOYEES 401 (K) PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS (In thousands)
January 31, 1994 ------------------------------------------------- Inter- Growth mediate American Fund of Bond Fund General Balanced America of America Subfund Subfund Subfund Subfund Subtotal ------- -------- ------- ---------- -------- ASSETS Investment in Michaels Stores, Inc. common stock $15,832 $15,832 Investment in mutual funds - $420 $ 748 $1,731 2,899 Participant loans receivable 331 30 110 161 632 Contributions receivable: Participants 79 21 29 32 161 Employer (1,751) - - - (1,751) ------ ---- ------ ------ ------ (1,672) 21 29 32 (1,590) Interfund due to/(from) (1,046) 209 345 31 (461) Cash 318 - - - 318 ------- ---- ------ ------ ------- Net assets available for plan benefits $13,763 $680 $1,232 $1,955 $17,630 ======= ==== ====== ====== =======
See accompanying notes. F-2 (1 of 2) MICHAELS STORES, INC. EMPLOYEES 401 (K) PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS (In thousands)
January 31, 1994 --------------------------------------------- Investment Previous Company of New Page America Perspective Subtotal Subfund Subfund Total -------- ---------- ----------- ------- ASSETS Investment in Michaels Stores, Inc. common stock $15,832 $15,832 Investment in mutual funds 2,899 $ 953 $249 4,101 Participant loans receivable 632 51 6 689 Contributions receivable: Participants 161 23 11 195 Employer (1,751) - - (1,751) (1,590) 23 11 (1,556) ------- ------ ---- ------- Interfund due to/(from) (461) 269 192 - Cash 318 - - 318 ------- ------ ---- ------- Net assets available for plan benefits $17,630 $1,296 $458 $19,384 ======= ====== ==== =======
See accompanying notes. F-2 (2 of 2) MICHAELS STORES, INC. EMPLOYEES 401 (K) PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS (In thousands)
January 31, 1993 ------------------------------------------------- Inter- Growth mediate American Fund of Bond Fund General Balanced America of America Subfund Subfund Subfund Subfund Subtotal ------- -------- ------- ---------- -------- ASSETS Investment in Michaels Stores, Inc. common stock $16,187 $16,187 Investment in mutual funds - $333 $593 $1,545 2,471 Participant loans receivable 157 14 47 145 363 Contributions receivable: Participants 89 18 32 48 187 Employer (251) - - - (251) ------- ---- ---- ------ -------- (162) 18 32 48 (64) Interfund due to/(from) (907) 103 223 222 (359) Cash 771 - - - 771 ------- ---- ---- ------ ------- Net assets available for plan benefits $16,046 $468 $895 $1,960 $19,369 ======= ==== ==== ====== =======
See accompanying notes. F-3 (1 of 2) MICHAELS STORES, INC. EMPLOYEES 401 (K) PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS (In thousands)
January 31, 1993 --------------------------------------------- Investment Previous Company of New Page America Perspective Subtotal Subfund Subfund Total -------- ---------- ----------- ----- ASSETS Investment in Michaels Stores, Inc. common stock $16,187 $16,187 Investment in mutual funds 2,471 $ 779 $171 3,421 Participant loans receivable 363 53 1 417 Contributions receivable: Participants 187 37 11 235 Employer (251) - - (251) ------- ------ ---- ------- (64) 37 11 (16) Interfund due to/(from) (359) 269 90 - Cash 771 - - 771 ------- ------ ---- ------- Net assets available for plan benefits $19,369 $1,138 $273 $20,780 ======= ====== ==== =======
See accompanying notes. F-3 (2 of 2) MICHAELS STORES, INC. EMPLOYEES 401 (K) PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS (In thousands)
Fiscal 1993 ------------------------------------------------- Inter- Growth mediate American Fund of Bond Fund General Balanced America of America Subfund Subfund Subfund Subfund Subtotal ------- -------- ------- ---------- -------- Investment income: Interest $ 24 $ 2 $ 5 $ 11 $ 42 Dividends - 18 3 114 135 Capital gains - 15 25 8 48 Net unrealized appreciation in fair value of investments (678) 15 71 11 (581) ------- ---- ------ ------ ------- (654) 50 104 144 (356) Contributions: Participants 780 220 292 304 1,596 Employer 459 - - - 459 Interfund transfers (146) 52 73 (51) (72) ------- ---- ------ ------ ------- Total additions 439 322 469 397 1,627 Distributions to participants (2,722) (110) (132) (402) (3,366) ------- ---- ------ ------ ------- Net increase (decrease) (2,283) 212 337 (5) (1,739) Net assets available for plan benefits: Beginning of year 16,046 468 895 1,960 19,369 ------- ---- ------ ------ ------- End of year $13,763 $680 $1,232 $1,955 $17,630 ======= ==== ====== ====== =======
See accompanying notes. F-4 (1 of 2) MICHAELS STORES, INC. EMPLOYEES 401 (K) PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS (In thousands)
Fiscal 1993 -------------------------------------------- Investment Previous Co. of New Page America Perspective Subtotal Subfund Subfund Total -------- ---------- ----------- ------- Investment income: Interest $ 42 $ 5 $ 1 $ 48 Dividends 135 22 3 160 Capital gains 48 35 6 89 Net unrealized appreciation in fair value of investments (581) 60 50 (471) ------- ------ ---- ------- (356) 122 60 (174) Contributions: Participants 1,596 282 85 1,963 Employer 459 - - 459 Interfund transfers (72) 1 71 - ------- ------ ---- ------- Total additions 1,627 405 216 2,248 Distributions to participants (3,366) (247) (31) (3,644) ------- ------ ---- ------- Net increase (decrease) (1,739) 158 185 (1,396) Net assets available for plan benefits: Beginning of year 19,369 1,138 273 20,780 ------- ------ ---- ------- End of year $17,630 $1,296 $458 $19,384 ======= ====== ==== =======
See accompanying notes. F-4 (2 of 2) MICHAELS STORES, INC. EMPLOYEES 401(K) PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS (In thousands)
Fiscal 1992 ------------------------------------------------------- Growth Fixed American Fund of General Income Guaranteed Balanced America Subfund Subfund Subfund Subfund Subfund Subtotal ------- ------- ---------- -------- ------- -------- Investment income: Interest $ 17 $ 135 $ 9 $ - $ 1 $ 162 Dividends - - - 10 6 16 Capital gains - - - 1 - 1 Net unrealized appreciation in fair value of investments 6,460 - - 1 53 6,514 ------- ------ ---- ---- ---- ------ 6,477 135 9 12 60 6,693 Contributions: Participants 749 348 - 100 179 1,376 Employer 668 - - - - 668 Interfund transfers (207) (3,519) (186) 362 674 (2,876) ------- ------ ---- ---- ---- ------ Total additions 7,687 (3,036) (177) 474 913 5,861 Distributions to participants (1,051) (152) (10) (6) (18) (1,237) ------- ------ ---- ---- ---- ------- Net increase (decrease) 6,636 (3,188) (187) 468 895 4,624 Net assets available for plan benefits: Beginning of year 9,410 3,188 187 - - 12,785 ------- ------ ---- ---- ---- ------- End of year $16,046 $ - $ - $468 $895 $17,409 ======= ====== ==== ==== ==== =======
See accompanying notes. F-5 (1 of 2) MICHAELS STORES, INC. EMPLOYEES 401(K) PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS (In thousands)
Fiscal 1992 ----------------------------------------------------- Inter- mediate Investment Previous Bond Fund Co. of New Page of America America Perspective Subtotal Subfund Subfund Subfund Total -------- ---------- --------- ----------- ------ Investment income: Interest $ 162 $ 3 $ 2 $ 1 $ 168 Dividends 16 43 20 2 81 Capital gains 1 - 2 - 3 Net unrealized appreciation in fair value of investments 6,514 (4) 14 - 6,524 ------- ------ ----- ---- ------ 6,693 42 38 3 6,776 Contributions: Participants 1,376 254 203 59 1,892 Employer 668 - - - 668 Interfund transfers (2,876) 1,758 905 213 - ------- ------ ----- ----- ------ Total additions 5,861 2,054 1,146 275 9,336 Distributions to participants (1,237) (94) (8) (2) (1,341) ------- ------ ----- ---- ------ Net increase (decrease) 4,624 1,960 1,138 273 7.995 Net assets available for plan benefits: Beginning of year 12,785 - - - 12,785 ------- ------ ------ ---- ------- End of year $17,409 $1,960 $1,138 $273 $20,780 ======= ====== ====== ==== =======
See accompanying notes. F-5 (2 of 2) MICHAELS STORES, INC. EMPLOYEES 401(K) PLAN NOTES TO FINANCIAL STATEMENTS JANUARY 31, 1994 1.Description of the Plan and Basis of Presentation The Michaels Stores, Inc. Employees 401(k) Plan (the "Plan") became effective on February 1, 1987, for eligible employees of Michaels Stores, Inc. (the "Employer" or the "Company"). The Plan is a defined contribution plan designed to comply with the Employee Retirement Income Security Act of 1974 ("ERISA"). The following is a brief description of the Plan. Participants should refer to the plan agreement for complete information regarding the Plan. Participation - Employees become eligible to participate in the Plan once they have reached the age of 21 and have completed 1,000 hours of service during the previous twelve months. Eligible employees who desire to participate in the Plan must elect to participate on the form or forms provided by the Plan's Administration Committee and authorize the Employer to make payroll deductions for contributions to the Plan. Contributions - Each participant may elect to have his/her salary reduced, in increments of whole percents, at a minimum of 2% up to a maximum of 15% of the participant's considered compensation, as defined by the Plan, and have the Employer contribute to the Plan the amount of such reduction ("Salary Reduction Contribution"). A participant's Salary Reduction Contribution may not exceed an amount determined by the Internal Revenue Service each calendar year ($9,240 in 1994 and $8,994 in 1993). Each participant may also elect to make voluntary, after- tax contributions at a minimum of 1% up to a maximum of 10% of the participant's considered compensation ("Employee Contributions"). In addition, the Employer is required to make an annual contribution ("Employer Matching Contribution") to the account of each participant in an amount equal to 50% of the participant's Salary Reduction Contribution which does not exceed 3% of such participant's total considered compensation for the year, provided that the aggregate Employer Matching Contribution shall not exceed 20% of the Employer's net profits for the fiscal year of the Employer which ends nearest to the end of the Plan year. Employer Matching Contributions are net of forfeitures, as defined, and are to be deposited no later than the date on which the Employer files its federal income tax return for such year, including any extensions which have been granted. Forfeitures of $266,000 and $69,000 were applied against Employer Matching Contributions to the Plan for the years ended January 31, 1994 and 1993, respectively. During 1993, Employer Matching Contributions exceeded the amount required under the Plan document by $1,500,000. The excess contributions are attributable to unsecured advances made for the payment of benefits in accordance with the terms of the Plan. These excess contributions will be used to satisfy 1994 and a portion of 1995 Employer Matching Contributions. F-6 The Plan provides for, among other things, an Investment Committee to direct Plan investments held in trust and managed by trustees (the "Trustees"), all employees of the Employer, appointed by the Board of Directors of the Employer. Participants may elect investment of their Salary Reduction Contributions and Employee Contributions in one of or in a combination of any four of the following investment options: (a) General Subfund - consists of investments in the common stock of the Employer and idle cash utilized to purchase Employer common stock. All Employer Matching Contributions are invested in the General Subfund. At January 31, 1994, 1,497 employees participated in this subfund. (b) American Balanced Subfund - a mutual fund investing in both domestic growth and income producing securities seeking conservation of capital, current income, and long term growth of both capital and income. At January 31, 1994, 398 employees participated in this subfund. (c) Growth Fund of America Subfund - a mutual fund investing in domestic growth equities seeking growth of capital. At January 31, 1994, 599 employees participated in this subfund. (d) Intermediate Bond Fund of America Subfund - a mutual fund investing in intermediate term investment grade corporate bonds and government instruments seeking current income and preservation of capital. At January 31, 1994, 679 employees participated in this subfund. (e) Investment Company of America Subfund - a mutual fund investing in common stocks seeking long term growth of capital and income. At January 31, 1994, 553 employees participated in this subfund. (f) New Perspective Subfund - a mutual fund investing in both domestic and foreign securities, including both equity and debt instruments, seeking long term growth of capital. At January 31, 1994, 214 employees participated in this subfund. Administration of the Plan - The Plan is administered by an Administration Committee consisting of three persons, all employees of the Employer, appointed by the Employer's Board of Directors. The members of the Administration Committee serve at the discretion of the Board of Directors without compensation for their services. A separate account is maintained for each participant. The account balances for participants are adjusted periodically as follows: (a) Salary Reduction Contributions and Employee Contributions and any withdrawals are allocated on a monthly basis. (b) Employer Matching Contributions are allocated to participants' accounts quarterly on January 31, April 30, July 31 and October 31. F-7 (c) Income and gains and losses from investments are also allocated to the participants' accounts quarterly determined by the percentage which the participant's account balance at the end of the period bears to the total of all participants' account balances at that date. Vesting - Participants become partially vested in the Employer Matching Contributions (including investment income and gains and losses thereon) at the rate of: 20% after two years of service; 40% after three years; 60% after four years; and 80% after five years. Employer Matching Contributions vest 100% upon completing six years of service (five years of service for individuals employed before May 1, 1992); attaining the age of 65; becoming disabled; or death. Salary Reduction Contributions and Employee Contributions are 100% vested and are nonforfeitable. Withdrawals - Upon death, disability or termination of employment with the Company, participants are entitled to the vested portion of Employer Matching Contributions and 100% of Salary Reduction Contributions and Employee Contributions. Income tax status - The Plan is designed to be a qualified plan under Section 401(a) of the Internal Revenue Code ("Code") and exempt from federal income tax under Section 501(a) of the Code. The Plan has not yet received a favorable determination letter from the Internal Revenue Service as to the qualification for tax exempt status; however, a favorable determination letter is expected. Salary Reduction Contributions and Employer Matching Contributions are not included in the participant's gross income for federal income tax purposes in the year such contributions are made. A participant will not be subject to federal income taxes with respect to these contributions until the amounts are withdrawn or distributed. Employee Contributions are not excluded from a participant's gross income for federal income tax purposes in the year such contributions are made. Termination of the Plan - While the Employer has not expressed any intent to discontinue the Plan, the Employer may terminate the Plan at any time. In the event the Plan is terminated, the participants would become fully vested, and the net assets would be distributed to participants in proportion to their account balances. F-8 2. Summary of significant accounting policies Investments in the common stock of the Employer are valued at the last reported sales price on the last business day of the Plan year as reported on the NASDAQ National Market System. Investments in the mutual funds of American Funds Service Company are valued at the last reported net asset value (NAV) on the last business day of the Plan year as reported on the NASDAQ automated quotation system. Security transactions are recorded on a trade date basis. Contributions and interest income are recorded on the accrual basis. Certain amounts in the 1992 financial statements have been reclassified to conform to the presentation in the 1993 financial statements. F-9 3. Investments Investments at January 31, 1994, are as follows:
Number (In thousands) of shares Cost Market ---------- ------ ------- Michaels Stores, Inc. common stock 490,925 $3,852 $15,832 American Mutual Funds: American Balanced Fund 32,632 404 420 The Growth Fund of America 27,274 625 748 Intermediate Bond Fund of America 120,568 1,724 1,731 The Investment Company of America 49,259 879 953 New Perspective Fund 15,924 198 249 ------ ------- $7,682 $19,933 ====== =======
The net unrealized appreciation in fair value of investments was determined as follows:
(In thousands) Unrealized Investments, Investments, Appreciation at cost at market (Depreciation) ------------ ------------ -------------- January 31, 1994 $7,682 $19,933 $12,251 Less: January 31, 1993 6,886 19,608 12,722 ------ ------- ------- Net unrealized appreciation in fair value of investments $ 796 $ 325 $ (471) ====== ======= ========
Investments at January 31, 1993, are as follows:
Number (In thousands) of shares Cost Market --------- ------- -------- Michaels Stores, Inc. common stock 479,606 $3,528 $16,187 American Mutual Funds: American Balanced Fund 26,894 333 333 The Growth Fund of America 23,928 541 593 Intermediate Bond Fund of America 108,391 1,548 1,545 The Investment Company of America 43,079 765 779 New Perspective Fund 13,936 171 171 ------ ------- $6,886 $19,608
(In thousands) Unrealized Investments, Investments, Appreciation at cost at market (Depreciation) ------------ ------------ -------------- January 31, 1993 $6,886 $19,608 $12,722 Less: January 31, 1992 2,848 9,046 6,198 ------ ------- ------- Net unrealized appreciation in fair value of investments $4,038 $10,562 $ 6,524 ====== ======= =======
F-10 4. Related party transactions -------------------------- Under the terms of the Plan, all expenses and fees of the Plan are to be paid by the Employer. The Employer paid approximately $70,000 and $184,000, respectively, for administrative and accounting fees on behalf of the Plan during fiscal 1993 and 1992, respectively. During fiscal 1993 and 1992, the Plan purchased 11,319 and 30,092 shares, respectively, of the Employer's common stock at a cost of approximately $324,000 and $680,000, respectively. 5. Differences Between Financial Statements and Form 5500: ------------------------------------------------------ The following is a reconciliation of net assets available for benefits per the financial statements to the Form 5500:
(In thousands) Year Ended Year Ended January 31, January 31, 1994 1993 ----------- ----------- Net assets available for benefits per the financial statements $19,384 $20,780 Amounts allocated to withdrawn participants (1,184) (800) ------- ------- Net assets available for benefits per the form 5500 $18,200 $19,980 ======= =======
The following is a reconciliation of distributions paid to participants per the financial statements to the Form 5500:
(In thousands) Year Ended Year Ended January 31, January 31, 1994 1993 ----------- ----------- Distributions paid to participants per the financial statements $3,644 $1,341 Add: Amounts allocated to withdrawn participants at January 31, 1994 and 1993, respectively 1,184 800 Less: Amounts allocated to withdrawn participants at January 31, 1993 and 1992, respectively (800) (148) ------ ------ Distributions paid to participants per the Form 5500 $4,028 $1,993 ====== ======
Amounts allocated to withdrawn participants are recorded on the Form 5500 for termination distributions that have been processed and approved for payment prior to year-end but not yet paid. F-11 Schedule 1 MICHAELS STORES, INC. EMPLOYEES 401(K) PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES January 31, 1994
(In thousands) Number of Fair Description Shares Cost Value - - ----------- --------- ------ ------- Michaels Stores, Inc. common stock 490,925 $3,852 $15,832 American Mutual Funds: American Balanced Fund 32,632 404 420 The Growth Fund of America 27,274 625 748 Intermediate Bond Fund of America 120,568 1,724 1,731 The Investment Company of America 49,259 879 953 New Perspective Fund 15,924 198 249 Participant loans receivable (Interest rates are at 7% with maturities from May, 1994 to January, 2004 689 689 ------ ------- $8,371 $20,622 ====== =======
F-12 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-11985) pertaining to the Michaels Stores, Inc. Employees 401(k) Plan and in the related Prospectus and in the Registration Statement (Form S-8 No. 33-21573) pertaining to the Moskatel's Inc. Savings/Retirement Plan and in the related Prospectus of our report dated July 22, 1994, with respect to the financial statements and schedule of the Michaels Stores, Inc. Employees 401(k) Plan included in this Annual Report (form ll-K) for the year ended January 31, 1994. ERNST & YOUNG Dallas, Texas July 28, 1994 F-13 -----END PRIVACY-ENHANCED MESSAGE-----